"We've shown we can generate primordial germ cells. These are the cells that go on to form either the sperm or the egg depending on the gender of the individual," says Professor Harry Moore, a UK reproductive biologist at the University of Sheffield.

"In culture, we've been able to show, using human embryonic stem cells, that some of those cells develop further to a later stage of sperm development," he says.

Although Moore and his team have not generated sperm from the stem cells derived from embryos donated for research, they believe that will be the next step.

"It is not a lot further, we think, to get to fully formed sperm," he adds.

Further down the line, once the technique is perfected and if it is proven safe, which Moore emphasised is a big "if", it may be possible to treat people who do not produce their own sperm and eggs, eliminating the need for donors.

If human eggs could be created from embryonic stem cells, it would also circumvent the need for donated eggs for therapeutic cloning.

Therapeutic cloning is a way of obtaining stem cells, and is a technique its supporters say may one-day be used to replace diseased tissue.

"One of the barriers to developing therapeutic cloning is that eggs have to be donated by women for this process. If we could use embryonic stem cells to create more eggs, we could use them for therapeutic cloning," Moore says.

Behrouz Aflatoonian, a member of Sheffield team who presented its research to the conference in Denmark, says the achievement is also important for understanding the causes of infertility and the potential harmful effects of environmental chemicals on reproductive development.